Wale Tinubu, Speaks On Foreign Inclusive Growth, Job Creation In Nigeria

Wale Tinubu

The Group Chief Executive of Oando PLC, Wale Tinubu, Africa’s leading indigenous energy solutions provider listed on the Nigerian and Johannesburg Stock Exchanges. He serves on the board of various blue-chip companies as Chairman and Director.

Wale speaks to CNBC Africa on foreign inclusive growth and job creation in Nigeria

CNBC: Africa's growth trajectory is expected to remain at 5% in the year 2014 with West Africa representing the continent's largest business opportunity. Now, tomorrow WEF Abuja kicks off in Nigeria with regional and global leaders discussing innovative restructural reforms and investments that can sustain the continent's growth. We got the thoughts of Wale Tinubu, CEO Oando PLC, on Nigeria's first hosting of the World Economic Forum.
Wale Tinubu: Well, it’s certainly an exciting time for the country. It is a great time for the WEF to be here, and we are looking forward to receiving all the guests and commencing a very, very interesting three days.

CNBC: Well, your relationship with the World Economic Forum goes back a long way and in 2008 you joined the Partnership Against Corruption Initiative (PACI), and this is very close to Oando’s heart. Can you tell us a little more about that initiative, and how you are tackling it in Nigeria.
Wale Tinubu: I think it’s an interesting initiative in which businesses look towards being able to operate in a corrupt free environment, and I think one of the key things that we’ve pushed right from Davos is an increase in transparency. For example, we do much better as economies where there is transparency in the grant of awards, the grant of business opportunities. For example, we saw in Nigeria where we had a transparent bidding process for the GSM licenses, and we have ended up with 120 million lines and over $35 billion of capital invested in our sector. So, it is something which we look forward to, and which we drive, and I think the rest of the colleagues in the forum. We have quite a lot of signups for the session and we look forward to that session as well.

CNBC: Another big theme when we spoke in Davos was economic inclusion. What is Oando doing when it comes to economic inclusion? We know that in Nigeria, 100 million of the 170 million in the country live below the bread line.
Wale Tinubu: I think we do quite a bit of that in terms of being good corporate citizens, I mean we pay over N20 billion a year in contribution to the tax space. We have a foundation where we have adopted over 80 schools which we focus on. I mean our big thing has been to focus on education, particularly at primary school level. Literacy is critical to us. We have a very ambitious plan towards adopting schools everywhere we do business: everywhere we have a petrol station or a pipe line or a rig functioning, we will take over the school next to us. We refurbish it, and it becomes one of ours. The same way you adopt a child is the same way we adopt a school. And we are increasingly spreading that same concept and we look forward to being able to partner with other corporates to the rest of Africa, raise capital, match our grants with others, and export our model.

CNBC: Wale give me an update on the privatization of the Nigerian Oil industry, how is that going?
Wale Tinubu: I think it is an ongoing process; there is quite a bit that has been already privatized and liberalized. I think the last bus stop really is that of the refineries, which has proven to be quite emotive in the past. But I think it is quite clear that something needs to be done towards ensuring we have a public-private sector partnership on the refining side, as well as encouraging the construction of private refineries within the country.

CNBC: ConocoPhillips. We chatted about the deal, which will be the biggest done by an African oil company on the continent, the deadline has now been moved to the end of June; you are waiting for regulatory approval, any further status update?
Wale Tinubu: Other than we are being extremely good and careful to ensure that the regulators can approve our transaction, we are quietly confident and look forward to that conclusion to the transaction, and we stand ready to close right afterwards.

CNBC: So you don't perceive any further challenges to the deal coming to fruition?
Wale Tinubu: No. Not commercial challenges, not financial challenges. I think we just have to wait for the public sector to play its own role.

CNBC: Talking about the public sector, the Petroleum Industry Bill is another issue that we have chatted about repeatedly, any developments on that front?
Wale Tinubu: I think there is certainly a re-awakening. I know that the House of Parliament, the Senate and the Reps, have been looking at the final readings of the law. I believe it’s something we need, that the industry needs to put to rest, because it’s a whole codification of all the regulations in our petroleum sector. For the sort of investment which we require for the next phase of the development of our industry we need certainty and that’s what that law gives us. Fiscal certainty, commercial certainty, and regulatory certainty, so we do look forward to that being passed.

CNBC: In the search for energy in Nigeria, I think the stat is that half of the Nigerian population does have access to electricity, although that is interruptive supply and the other half of the Nigerian population live in complete darkness. The flaring of gas has long been an issue that has been discussed in Nigeria, and I think Nigerian and international companies have potentially been flaring gas for almost three decades. But this is changing; where are we with utilizing gas to produce energy?
Wale Tinubu: Majority of the multinationals today have zero flare down policies. There are probably some old fields that still have technology that need to be upgraded to do that. But all the new designs are coming with zero flare down technical specifications. One thing is clear: The opportunity is very large; there is an abundant amount of gas. The infrastructure is what we need to build out, and which we continue to build out, and to be able to deliver gas to the locations where it is required from the Niger Delta. I am excited about the power reform that has gone on. Now the distribution companies are in the hands of the private sector, the generating companies are in the hands of the private sector, and we now have an enabling environment where private sector capital can develop new plans. So, indeed that half that doesn't have electricity is a question of time.